Australia's Commonwealth Bank overcomes protest vote at testy AGM

Reuters Staff

2 Min Read

SYDNEY, Nov 16 (Reuters) - Commonwealth Bank of Australia easily overcame a protest vote against executive remuneration and board appointments at an annual general meeting on Thursday, as it struggles to rebuild its reputation after a series of scandals.

The remuneration report gained 91.4 percent support, lower than the near-unanimous result most large Australian companies get for that item, but enough to protect the A$142 billion ($108 billion) lender from a mandatory board spill.

Shareholders also supported the appointment of four directors to the board of Australia’s biggest company, although one of the nominees won only 84 percent of the vote, in a sign of shareholder dissatisfaction.

“Most of your executives ... are on A$1 million plus,” said Rodney Jeffrey, one of dozens of shareholders to speak at the three-hour meeting.

“Why should there be an incentive system at all? Aren’t people committed to a company on that salary?”

The meeting was being watched for signs of a shareholder revolt after a year in which CommBank faced two lawsuits and two investigations over allegations of breaching anti-money-laundering and terror-financing rules.

The bank’s reputation had already been tarnished in recent years by accusations it cheated people out of life insurance payments and gave customers poor financial advice through its wealth management unit.

CBA responded to the money-laundering allegations by cutting executive bonuses, announcing the departure of Chief Executive Officer Ian Narev and overhauling its board. It says most of the alleged money-laundering breaches were caused by a software glitch, and contests its level of responsibility.

Australia’s corporate and banking regulators have started separate investigations into the bank, and litigation funder IMF Bentham Ltd has filed a shareholder class-action lawsuit.